Liberty Media begins Dutch auction tender offer for up to $285 million 8½%, 8¼% debentures

By Angela McDaniels

Tacoma, Wash., Nov. 3 - Liberty Media LLC began a modified Dutch auction tender offer on Monday for its $500 million 8½% senior debentures due 2029 and $901.62 million 8¼% senior debentures due 2030.

The company said it will purchase up to $285 million principal amount of debentures under the offer.

The debentures are attributable to the Liberty Interactive tracking stock group, a company news release noted.

The total payment for each $1,000 principal amount of debentures will equal a base price of $550 plus a clearing premium and accrued interest up to but excluding the settlement date.

The clearing premium will be determined by consideration of the bid premiums - the amount by which each bid price exceeds the base price - of all tendered debentures, in order of lowest to highest. The base price plus the clearing premium must fall between $550 and $620.

The company said the clearing premium will be the lowest single premium such that for all tenders of debentures whose bid price resulted in a bid premium equal to or less than this single lowest premium, Liberty will be able to purchase the greatest principal amount of debentures for $285 million.

Each bid price submitted will include an early participation payment of $10 per $1,000 principal amount for debentures tendered by 5 p.m. ET on Nov. 17.

The tender offer will expire at 5 p.m. ET on Dec. 3.

If the total amount of debentures validly tendered would cause Liberty to spend more than $285 million, then Liberty will first accept for purchase all debentures tendered at a bid premium less than the clearing premium and then accept debentures tendered with a bid premium equal to the clearing premium on a prorated basis.

The tender offer is conditioned on customary conditions but is not conditioned on financing or on any minimum amount of debentures being tendered.

Citi (800 558-3745 or 212 723-6106) and Deutsche Bank Securities (866 627-0391 or 212 250-2955) are the dealer managers, and Global Bondholder Services Corp. (866 873-7700 or 212 430-3774) is the depositary and information agent.

Englewood, Colo.-based Liberty Media owns interests in electronic retailing, media, communications and entertainment businesses and is an intermediate holding company of Liberty Media Corp.

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